Interest taxation under DTAA: source state may tax, residence retains taxing rights; reduced withholding and specific exemptions apply. Article 11 permits taxation of interest by the residence State and also by the source State subject to a reduced withholding charge when the recipient is the beneficial owner. Certain interest is taxable only in the residence State-notably interest on loans made, guaranteed or insured by specified governmental and public financial institutions-and approved loans from India to Swiss residents are exempt from Indian tax. Interest connected with operations of ships or aircraft may be taxed only in the residence State to the extent related to those activities. Interest is defined broadly and interest attributable to a permanent establishment or fixed base is taxed under provisions for business profits or independent personal services. Special-relationship adjustments limit treaty relief to arm's-length interest.